Presented Questions:
1. Why might TCDC seriously consider the AG's plea deal and agree to pay a large fine rather than to be indicted and proceed to trial?
2 As TCDC's General Counsel. how would you determine the optimal amount of legal research to undertake to prevent TCDC from violating the many thousands of federal and state (not to mention
local) regulations?
The Criminalization of American Business What do Bank of America, Citigroup, JPMorgan Chase, and Goldman Sachs have in common! All paid hetty fines for purportedly misleading investors about mortgage-backed securities in tact, these companies paid the government a total of $50 billion in hines. The payments were made in lieu of criminal prosecutions Today several hundred thousand federal rules that apply to businesses carry some form of criminal penalty. That is in addition to more than four thousand federal laws, many of which carry criminal sanctions for their violation. Rom 2000 to 2019. about 3 200 corporations either were convicted or pleaded guilty to violating federal statutes or rules Criminal Convictions The first succesful climinal conviction in a tedural court against a company-the New York Central and Hudson River Railroad-was uphold by the Supreme Court in 1909 (the violation, cutting erkend Many other successful convictions followed One landmark case developed the aggregation test, now called the Doctrine of Collective Knowledge. This test aegregates the missions and acts of two or more persons in a corporation, thereby constructing an actus rus anda mens red out of the conduct and knowledge of several individuals Not all government attempts at applying criminal tuw to corporations survive. Courts have sometimes found insufficient evidence to show that a company acted with specific intent to commit a crime: Ortion however, companies choose to reach settlement agreements with the government rather than fet criminal indictments Many Pay Substantial Fines in Lieu of Prosecution More than four hundred corporations reached so-called non prosecution agreements with the government from 2000 to the beginning of 2019. These agreements typically involve multimillion or multibillion-dollarines. This number does not include fines paid to the Environmental Protection Agency or to the Fish and Wildlife Service According to low professors Margaret Lemos and Max Miner, "Public enforcers often seek large monetary awards for self-interested reasons divorced from the public interest and deterrents. The Incentives are strongest when enforcement agencies are permitted to retain all or some of the proceeds of enforcement Fact Pattern Fact Pattern You are once again the General Counsel for Tom Crulie Delivery Company CTCDC) The Cifornia Attorney General has issued multiple subpoenas for TCDC records and files over the past several months. The Ay office frally contact you and Tom Cruise to formally notity the two of you just as happened in the New York Central and Mudron River Railroad Com. TCDC and its corporate wecuties includink you and Tom Cruise will be criminally charged with cuttine its prices You and Tom Cruise know with 100% certainty that the charges are bous, but it will also take several years and millions of dollan of TCDC money to fight the change not to mention divert attention away from running the brines At the same time, the AG's office offers a plea deal for TCDC to plead Builty and wine.no executives will be indicted Questions Presented 1. Which TCDC seriously consider the AG's plea deal and apree to pay tarpe tine rather than to be bidicted and proceed to trial? 2. As TCDC General Counsel, how would you determine the optional amount of legal research to undertake to prevent TCDC from Volatin the many thousands at federal and state inot to mention local regulations? The Criminalization of American Business What do Bank of America, Citigroup, JPMorgan Chase, and Goldman Sachs have in common! All paid hetty fines for purportedly misleading investors about mortgage-backed securities in tact, these companies paid the government a total of $50 billion in hines. The payments were made in lieu of criminal prosecutions Today several hundred thousand federal rules that apply to businesses carry some form of criminal penalty. That is in addition to more than four thousand federal laws, many of which carry criminal sanctions for their violation. Rom 2000 to 2019. about 3 200 corporations either were convicted or pleaded guilty to violating federal statutes or rules Criminal Convictions The first succesful climinal conviction in a tedural court against a company-the New York Central and Hudson River Railroad-was uphold by the Supreme Court in 1909 (the violation, cutting erkend Many other successful convictions followed One landmark case developed the aggregation test, now called the Doctrine of Collective Knowledge. This test aegregates the missions and acts of two or more persons in a corporation, thereby constructing an actus rus anda mens red out of the conduct and knowledge of several individuals Not all government attempts at applying criminal tuw to corporations survive. Courts have sometimes found insufficient evidence to show that a company acted with specific intent to commit a crime: Ortion however, companies choose to reach settlement agreements with the government rather than fet criminal indictments Many Pay Substantial Fines in Lieu of Prosecution More than four hundred corporations reached so-called non prosecution agreements with the government from 2000 to the beginning of 2019. These agreements typically involve multimillion or multibillion-dollarines. This number does not include fines paid to the Environmental Protection Agency or to the Fish and Wildlife Service According to low professors Margaret Lemos and Max Miner, "Public enforcers often seek large monetary awards for self-interested reasons divorced from the public interest and deterrents. The Incentives are strongest when enforcement agencies are permitted to retain all or some of the proceeds of enforcement Fact Pattern Fact Pattern You are once again the General Counsel for Tom Crulie Delivery Company CTCDC) The Cifornia Attorney General has issued multiple subpoenas for TCDC records and files over the past several months. The Ay office frally contact you and Tom Cruise to formally notity the two of you just as happened in the New York Central and Mudron River Railroad Com. TCDC and its corporate wecuties includink you and Tom Cruise will be criminally charged with cuttine its prices You and Tom Cruise know with 100% certainty that the charges are bous, but it will also take several years and millions of dollan of TCDC money to fight the change not to mention divert attention away from running the brines At the same time, the AG's office offers a plea deal for TCDC to plead Builty and wine.no executives will be indicted Questions Presented 1. Which TCDC seriously consider the AG's plea deal and apree to pay tarpe tine rather than to be bidicted and proceed to trial? 2. As TCDC General Counsel, how would you determine the optional amount of legal research to undertake to prevent TCDC from Volatin the many thousands at federal and state inot to mention local regulations
